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The most significant initiative of the UPA government

in the last year has been the move to set up the Jawaharlal
Nehru National Urban Renewal Mission (JNNURM) with
its promise of Rs. 1,25,000 crore to 63 chosen cities. The
rationale is that cities are currently inefficient in raising
resources to meet their growing needs and are also
inefficient in governance. Hence the Centre proposes to bail
out cities with funds to meet their infrastructure needs,
however, on condition that cities carry out certain
governance reforms (some mandatory and some optional) which
will make them self-sustaining and efficient in the future.
The Centre is also under pressure to ensure that the
Millennium Development Goals, with regard to halving
hunger, reducing poverty and ensuring water and sewerage
to all are reached. With 23.6% of the urban population in
the country below the poverty line and 14.12% living in
slums, providing Basic Services to the Urban Poor (BSUP)
is another objective under the JNNURM. Hence, the Centre
has set up two sub-missions, one on Urban Infrastructure
and Governance and the second on Basic Services to Urban
Poor (BSUP).
Why arecities starved of funds: If the cities are emaciated
and starved of funds today, it is largely because they have
not been adequately compensated for the loss of octroi, etc.
Also, the sharing of funds between the States and cities, as
per the recommendations of State Finance Commissions set
up under the 74th Constitutional Amendment (CA) has not
been happening. These funds are supposed to be given to
cities as untied funds for them to use as they wish with no
strings attached, as the very spirit of the 74
CA is that local
bodies should become local self-governments. In Kerala,
the local bodies get 40% of the State funds as untied grants
to accommodate the peoples plan. Without looking into
these structural causes for cities poor financial position-
and setting them right - it may be unfair to impose on them
which they may not agree with.
Do conditionalities & the74
CA jell?: Anachronistically,
the very first mandatory reform suggested under the
JNNURM is also the implementation of the 74th CA. How
does this jell with the conditionalities being imposed under
the JNNURM for giving the funds? Arent the two
completely contradictory? Experts opine that putting
conditionalities is the very reverse of the professed goal of
decentralisation and is, in fact, a reversal to centralisation.
Municipal budgets & eliteinterests: One has to also accept
that, like self-willed but immature children, city
governments are not doing all that they can for their citizens;
hence a little bit of disciplining might be perfectly in order.
For instance, most States have reneged on fully
implementing the Constitutional directives on 74
CA itself.
Also, the current bane of all municipal budgeting is that it
gets hijacked to serve the interests of the elite (in urban
infrastructure it goes mainly to support the needs of the private
car-based economy) in the form of fly-overs, expressways, etc.,
a la big dams in rural areas, which guzzle a huge amount of
funds to benefit only a few. The Bangalore Mahanagara
Palike (BMP), for instance, routinely budgets funds for slum
improvement which never get used. The building of
convention halls, shopping arcades, multiplexes and golf
clubs with JNNURM funds is currently on the priority wish-
list of some leaders of Karnataka.
Fixed division of funds: One of the fixed allocations under
the JNNURM, of allocating 65% of funds for city
infrastructure while allocating only 35% for basic services
to the urban poor appears to be abetting such misplaced
priorities. But at the same time, there are mandatory
conditionalities asking municipalities to internally earmark
funds for basic services to urban poor within their budgets.
However, without saying how much should be earmarked
or fixing targets for achievements in this regard, one gets
the feeling that this is a camouflaged statement meant to
deceive the public into believing that the Missions
intentions are absolutely benign. Fears are also being
expressed about whether these funds would be accessible
by non-notified slums and if not, whether this would not in
fact create new forms of exclusion and possibly, even further
evictions. Also, is the promise of security of tenure being
flaunted merely to identify tenants and sub-tenants and
push them out?
Kathyayini Chamaraj
Executive Trustee
Bitter pill packaged in benign wrapper? The fear is that the
JNNURM is a bitter pill being packaged in a shiny wrapper.
In order to access it, one will have to throw the shiny wrapper
and eat the bitter pill. The wrapper consists of the promise
of 1 lakh crore, cursory and tokenistic consultations with
stakeholders in the name of peoples participation; the lip
service to the 74
CAA, the benign language of security of
tenure to slum-dwellers and the promise of 25% land in all
housing projects. The vested interests in the local bodies
are eager to lay their hands on the promised manna, hence
they wont mind making the citizens eat the bitter pill.
Game-plan with hidden agenda? There is not much reason
to doubt the hidden agenda behind the JNNURM, as this is
the same Government which has closed its eyes to gross
human rights violations in the form of slum evictions and
demolitions that have taken place in Delhi, Kolkatta and
Mumbai in the preceding two years in the name of
beautification and renewal of cities. Since the demolitions
met with loud outcries and even reprimands from the UN,
the game-plan appears to be to camouflage the same
intentions under a shiny wrapper of benign benevolence. It
is significant that the JNNURM document nowhere gives
an assurance that evictions and demolitions will be
Limit demands to MDG fulfillment: If this game-plan has
to be beaten - and since the priority need is to fulfil the
Millennium Development Goals for which most
municipalities are not providing enough - all the resources
required to meet the water, sanitation, housing, child
nutrition, day-care (ICDS) needs, primary education,
primary health care and social security of all those living in
under-privileged areas should be realistically estimated and
made the first charge on any resources that municipalities
are able to raise under JNNURM. That may be all that the
municipalities can raise over the next seven years. Only after
they have fulfilled these basic needs could further resources
raised by them be allowed to go towards their more five-
star dreams of multiplexes, golf clubs, et al.
The JNNURM, as it stands now, does not seem to benefit
city residents or help cities to grow or prosper. It needs either to be
scrapped or radically restructured. It mandates full implementation
of the 74th Amendment decentralisation measures but many key
provisions in it undermine this very mandate. Hence, it must be
modified to meet the following demands or not implemented at
Citizens Voluntary Initiative for the City
for private circulation only
No. 1
August 2006
The Jawaharlal Nehru
National Urban Renewal Mission (JNNURM)
A critique
CitizensVoluntaryI nitiativefor theCity
14, I I nd Floor, 12th Cross Road, 4th Main Road
Vasanthanagar, Bangalore 560 052 Tel : 22386864
E-mail :
CIVICs demands on JNNURM
1. All proposed policy changes should be preceded by a
policy for the urban poor, ensuring them free, or nearly
free, minimum basic services. No plans to privatise basic
services should be initiated.
2. The Right to Shelter of all, declared a part of the Right
to Life and Livelihood under Article 21 by the Supreme
Court in 1981 and 1990 to be ensured by earmarking
adequate land for the housing of the urban poor in
Bangalore, for instance, disused factory lands. The
earmarking of 25% for EWS in all housing projects to be
made mandatory.
3. No slum evictions and demolitions to take place as it is
a violation of Article 11 (1) of the International Covenant
on Economic, Social and Cultural Rights (ICESCR) which
India has ratified. All rehabilitation to be as per
international conventions and the seven principles laid
down by the UN Committee on Economic, Social and
Cultural Rights
4. All projects must be in line with the guidelines laid
down by the National Slum Policy, National Housing and
Habitat Policy and National Street Vendors Policy.
5. The very first project to be taken up by all cities should
be the upgradation of all slums and provision of basic
services to all the urban poor. The total cost for this should
be realistically estimated and should be made the first
charge on NURM funds. Only when these are completely
budgeted, should other projects be taken up.
6. NURM funds to be allowed to be used for strengthening
primary education, primary health care, employment and
social security to the urban poor.
7. Amend the Acts and Rules under the 74
within the next six months to incorporate the elements of
community participation and public disclosure into it after
intensive and inclusive dialogue and consultation among
citizens and civil society groups.
8. Implement the revised 74
Amendment, including the
setting up of the Metropolitan Planning Committee in the
following six months. Implement other reforms proposed
under NURM which are agreed to by citizens after
intensive and inclusive dialogue. Agreed reforms to be
implemented in a way that promotes the achievement of
the Millennium Development Goals (MDGs).
9. Conduct massive capacity building of municipalities,
elected representatives and communities on the 74
Amendment and NURM with the 5% funds earmarked for
it under NURM.
10. Prepare genuinely bottom-up CDP plans by involving
communities in ward and sub-ward sabhas. Consult
groups of other civil society groups at city-level
consultations. The BMP Council to be involved at each
stage of CDP preparation and implementation. Fate of CDP
drawn up by BDA to be decided. All plans to be
consolidated into the CDP by the Metropolitan Planning
Committee and District Planning Committees that will be
set up under the 74
11. The Centre to be convinced to increase its grants under
NURM from 35% of the cost of projects to at least 80% to
prevent BMP from getting into a debt trap.
drafting the community participation law? One needs to
question the legitimacy of the process by which these Bills
have been drafted. There are also provisions in the
Community Participation Law which may be in conflict with
the way institutions and structures, such as wards
committees, are currently constituted under the laws framed
by individual States under the 74
CA. How will the two be
reconciled? No doubt the 74
CA and ward committee Rules
have their flaws. But wouldnt it be preferable to amend
existing laws themselves to bring in the elements of
community participation and public disclosure so that there
are no conflicts between the separate laws? Moreover, the
Community Participation Law is asking for a modified
version of the discredited system of nominations to ward
committees from Area Sabhas and for nomination of elite
institutional groups within the ward, which is hardly an
improvement on what is existing now.
I nvestment in social sectors exempted: Among the items
for which no funds under the JNNURM can be sought are
primary health, primary education, employment
opportunities and social security in short, the very items
that need focus to foster human development to meet
MDGs - and not just economic growth. Currently, the urban
poor are forced to go to private schools and hospitals that
they can ill afford because public provisioning of these is in
a shambles. These may be the areas that a City would like to
invest in but these are to be financed only through the
existing departmental budgets which everyone knows are
inadequate. Investing in this social infrastructure provides
the highest returns in terms of economic growth, much
more than investment in roads, fly-overs, metros, airports,
etc. And decent employment for the unorganised poor and
migrant workers is the need of the hour. But these are not to
be financed under the JNNURM.
Spacefor livelihoods of thepoor: If land is being freed to
ensure that investment funds flow towards the high-end
sectors, what about ear-marking land for securing the
livelihoods of the urban poor by providing the space for
carrying on their trades, etc., which alone will enable the
migrants to survive on their own. Food-courts, hawking
zones, workers sheds for carrying on activities such as
agarbatti-rolling, beedi-rolling and a number of such
household enterprises, unless provided for, will result in
unsafe and unhygienic living conditions for the poor. Lack
of space for carrying on their livelihoods will constrain their
ability to make a living which they do mostly without any
material support, subsidy, etc., from the government.
Social security for theunorganised: Social security is to be
provided under existing universal schemes, but there are
no existing universal schemes for social security for the
unorganised. However, there is mention of social security
as a contributory insurance scheme with private companies.
It is obvious that the poor will never be able to bear the full
cost of their social security considering their meagre
earnings. The states contribution towards their social
security is indispensable. Whatever happened to the Centres
many draft bills to provide comprehensive social security
coverage to the unorganised?
Fromwherewill cities raisefunds? The most crucial element
of the JNNURM, however, is the requirement for the local
bodies of mega cities to raise 50% of the funds themselves
and for the State governments to cough up another 15%.
Only then will the 35% in the form of grants from the Centre
under JNNURM be released. Considering that most
municipalities prepare illusory budgets for thousands of
crores each year but are never able to raise more than about
50% of it (from property tax, loans and grants), the big
question is: from where will municipalities raise their share
of thousands of crores in the next seven years?. One can
imagine the fate of the municipalities if they have to pay
interest on thousands of crores to get the money under
JNNURM. The only other alternative will be for the citizens
to tighten their belts and pay up higher property taxes,
cesses, users fees et al, if they want their wish-list for their
city to be actualised.
J NNURM castles in theair? Critics feel that the Centre
knows that the cities will never be able to raise their share.
And if the fate of crores of rupees promised by the Centre to
the State governments under Sarva Shiksha Abhiyan, which
lapse because the State governments fail to provide their
share of 25% - is anything to go by, the State governments
may not be able to cough up their share of 15% of the funds
for JNNURM. So, the whole idea of JNNURM appears to be
a mirage provoking citizens to build castles in the air.
J NNURM & neo-liberal agenda: Activists fear that the real
intention of the Centre in dangling the promise of Rs. One
lakh crore is a ruse to force the local bodies to undertake the
neo-liberal reforms that it wants them to, viz. free the land
market, undo the checks and balances that prevent
concentration of land in the hands of the real estate lobbies,
MNCs, land mafias and what-have-you. YUVA of Mumbai
has expressed deep apprehensions that NURM could be used
as an instrument to intensify the deprivation of critical
populations from the process of decision-making and access to land,
infrastructure and resources.
The other ruse appears to be to force local bodies to
go with a begging bowl to International Financial Institutions
to raise their share of funds. These IFIs, such as WB, ADB,
USAID, etc. - who are currently the shadow players behind
the Mission - will, in turn, demand their pound of flesh in
terms of interest on loans and further conditionalities to
privatise public services and give the contracts to their
favoured MNCs, chosen and imposed by them. The MNCs,
in turn, will laugh all the way to the bank, as was going to
happen in the case of the Delhi Jal Board, if people, helped
by the NGO Parivartan, had not used the Right to
Information Act effectively to expose the game-plan of the
IFIs and protest vigorously.
Areprogressivereforms really so? Considering the state of
many municipal accounts, wherein the opening balance
often does not correspond with the previous closing balance
and audits have not been done for decades (BMP), there may
not be much opposition from the people to the Centre
imposing some technical conditionalities, such as the
adoption of a Fund-Based Accounting System (FBAS), e-
governance and GIS for universal property tax coverage,
etc., though some activists fear that these technological fixes
tend to undermine political autonomy of local governments
and get manipulated by the elite and powerful to serve their
own interests.
Undermining federal nature: But conditionalities which
impose undesirable policy changes - such as those
prescribing on what items money can be spent or how much
can be spent; making collection of user fees mandatory
(without a clear enunciation of a policy regarding these for the
urban poor); requiring repeal or introduction of certain laws
which will benefit the elite; initiating public-private-
partnerships, which in other words means forced
privatisation of public services - appear to be a direct
infringement of States freedom and the spirit of the 74th
Amendment. Critics see the imposition of conditions on
municipalities to privatise their services as seriously
undermining the federal and democratic nature of
decision-making in India. One condition even says that
States have to agree to put a stop to all further recruitment
for government positions. A former chief secretary of
Karnataka questions how the Centre knows how many
persons are needed or not needed in a particular State. He
also points out that the States were not consulted even on
the selection of cities to benefit under JNNURM.
Privatisation of services not a panacea: If the conditionality
of JNNURM is on privatisation of basic services, despite the
recent revealing experiences of the Delhi Jal Board in its plans
to privatise operation and maintenance of water supply, it
will have to be opposed through peoples sustained
campaigns. The World Bank tried to arm-twist the Delhi Jal
Board to accept the tender of its favourite US MNC, Price-
Waterhouse-Coopers. The tender conditions were more or
less on the lines of the infamous Enron agreement which
would have only led to the bankruptcy of the Delhi Jal Board.
The refrain is always, From where will the funds
come, unless we bring in private investment? There are
many examples from Latin America which show that
privatisation is not a panacea and that there are alternative
ways of overcoming the cities inefficiency and corruption.
These alternatives indicate that it is possible to make the
people own service agencies as opposed to the public or
private sectors - by making each citizen a share-holder in a
citizens cooperative to run the service. These have proven
to be efficient and free of corruption. If obligatory functions
of the state, such as water supply, solid waste management,
primary education and primary health care, etc., are to be
privatised, then why do we need to pay taxes and why do
we need a government, is the cry of several activists. While
talking of privatising services, there is no mention in the
JNNURM of certain services being provided free, for
instance, a minimum quantity of water for subsistence, as a
human right of all, as in South Africa.
Tokenistic stakeholder participation in CDPs: The JNNURM
is asking that a vision document for the city and City
Development Plans (CDPs) should be prepared through
multi-stakeholder consultations. But going by the ad hoc
consultations conducted by BMP on May 6
, which were
attended by about 25-30 persons from a whole Range, and
in which the urban poor were hardly represented (a councillor
claimed that he was there to represent the absent urban poors
interests) how is it going to be ensured that all stakeholders
views have been adequately taken into consideration? Critics
point out that the plans are being made without clear
process guidance, adequate and up-to-date planning data,
advocacy with stakeholders and their capacity building in
order that they may participate effectively. In fact, the CDP
of Bangalore along with Vision and Mission statements has
already been prepared by the consultants iDeCk, and the
consultations with stakeholders being undertaken now
appear to be merely to fulfil formalities.
Bypassingelected councils: The BMP was unaware of the
JNNURM till May 6
. It is merely to pass a resolution
accepting the CDP; it is hardly going to be the author of it.
The fear that the whole process will be decided by
bureaucrats and consultants which will by-pass the
democratically-elected council, weakening democratic
processes, is coming true. But the Council will be the one
which will have to repay the loans.
The linkage of the CDP plan under the NURM with
other statutory plans is also unstated, warn critics. For
instance, what happens in cities, such as Bangalore, where a
CDP was already prepared for the BDA by foreign
consultants in a top-down manner with no inputs from the
people? Is it going to be abandoned after it has swallowed
crores of rupees? This time around too under the JNNURM,
other empanelled consultants are waiting in the wings to
put together the new CDPs as per the suggestions of a
handful of residents - and rake in the moolah.
Where are the DPCs and MPCs? Again, as per the 74th
Amendment, planning is a function of the District Planning
Committees and the Metropolitan Planning Committees.
These have not even been set up in most States in what is a
gross Constitutional violation. If these are not made
functional before the City Development Plans are finalised
under the JNNURM (which are supposed to have a vision for
the next 20-25 years), where is the legitimacy for the ad hoc
planning process now under way?
Multiplicity of new laws: It seems that the Community
Participation Law and Public Disclosure Law are being
imposed as mandatory reforms and as fait accompli. One
wonders: where was the community participation in